Comhairle pays Stornoway company £450,000 to settle Lews Castle contracts dispute

Comhairle nan Eilean Siar has settled a long-running court case brought by Kenman Holdings Ltd in a dispute relating to the redevelopment of Stornoway’s Lews Castle

Monday, 5th October 2020, 6:55 pm
Lews Castle was at the centre of a dispute between the Comhairle and Kenman Holdings Ltd.

In a statement, the Comhairle said that it had settled the case without an admission of liability “on economic grounds” and confirmed that it had made a payment to Stornoway-based Kenman Holdings Ltd of £450,000 including legal expenses and interest.

The case arose following allegations by Kenman Holdings Ltd concerning aspects of the conduct of the tendering process by Comhairle Nan Eilean Siar for contracts relating to the operation of the redeveloped leisure facility, which the authority denied and vowed to fight in court.

Kenman Holdings Ltd were seeking compensation in courts for more than £23 million prior to the settlement of the case. 

A recent court judgement allowed the case to progress and, in early September, at a specially convened meeting of Comhairle nan Eilean Siar, the authority agreed to pursue settlement of the case.  

Kenneth Mackenzie of Kenman Holdings Ltd, said: “Taking all aspects surrounding our claim into consideration, including Covid-19, Kenman’s directors and I are satisfied this is a fair outcome.”

Members of the Mackenzie family own Stornoway’s Cabarfeidh Hotel, Caladh Inn and Royal Hotel, although the hotels are operated as separate companies.